A natural gas price will likely rise by as much as 4.4 per cent next year, according to the RTE Energy Economics report.
The report forecasts the average wholesale price for natural gas will rise by $2.70 per million British thermal units (MMBtu) to $9.75 per MMBtu in 2021.
This would represent a 7 per cent increase on the $9 per Mmbtu average for natural oil and gas prices in 2017.
The forecast is a big increase on forecasts from the UK Energy Research Institute (ERGI), which estimated the wholesale price would fall by 4.2 per cent to $11.90 per MUBtu in 2022.
The RTE report predicts the average price of natural gas for the same year will be $8.10 per Mbtu.
“Wholesale prices are set to continue to decline, with natural gas prices falling by 4 per cent in 2021, with gas prices expected to rise by 3.5 per cent by 2021 and by 4% by 2022,” the report said.
The RTE study forecasts wholesale prices will drop by 3 per cent a year on average from 2021 to 2023, and by 5 per cent from 2023 to 2028.
“Natural gas is one of the most important components of the UK’s energy mix and we are increasingly looking to natural gas to help meet the country’s energy needs.
This is the main reason for the continuing increase in natural gas consumption,” it said.”
Gas is an important element in the UKs energy mix, contributing nearly 7 per to 10 per cent of UK electricity demand.
It has become increasingly popular in recent years and is expected to be an important part of the countrys energy future,” the RTP said.
It is forecast that the average cost of natural oil (CO 2 ) will rise to $19.20 per barrel in 2021 from $17.70 in 2021 and $20.30 per barrel by 2022.
“The average cost for natural natural gas is forecast to increase by 5.4 percent over the same period, reaching $19 per barrel, while the price for oil is forecast increase by 2.5 percent, reaching about $30 per 1,000 cubic metres,” the energy report said, adding that it was “likely that gas prices will increase significantly over the next few years as CO 2 prices fall”.
The RTP study forecast natural gas would account for just over 1 per cent (1.5 million) of the total UK energy mix by 2022, with the UK economy expected to use the gas for just under two thirds of total energy consumption.
The UK’s Natural Gas Supply and Demand Analysis (NGAD) said natural gas accounted for more than half of the £1.3 trillion ($2.7 trillion) of CO 2 emitted globally in 2017, with a significant proportion of this gas being consumed by the UK.